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Attorney General Conway Announces $5.5 Million Settlement With Global Drug Maker AstraZeneca

Thursday, 02 07, 2013

Shelley Catharine Johnson
Deputy Communications Director
502-696-5659 (office)

Attorney General Jack Conway and his Offices of Medicaid Fraud and Abuse Control and Consumer Protection today announced a $5.5 million settlement with AstraZeneca Pharmaceuticals LP to resolve allegations of off-label marketing of the atypical antipsychotic drug Seroquel. AstraZeneca, headquartered in London, England, is a global pharmaceutical manufacturer operating in more than 100 countries.

The settlement resolves allegations that AstraZeneca illegally marketed Seroquel for uses the Food and Drug Administration (FDA) had not approved as being safe and effective. The FDA has only approved Seroquel for the treatment of schizophrenia and various bipolar disorders in adults.

“I am pleased that we have reached this settlement and are recovering millions of dollars for a vital state program and for taxpayers,” General Conway said. “We’ve sent a clear message today that Kentucky will not tolerate drug companies that put profits ahead of patient care.”

Under the settlement, the Kentucky Medicaid program will receive more than $3.3 million.  The remainder of the proceeds will be distributed on a pro-rata basis to the Kentucky Department for Behavioral Health, Developmental and Intellectual Disabilities for certain treatment conducted at facilities across the Commonwealth, and to the Kentucky Department of Corrections, the Department for Juvenile Justice, the University of Kentucky Medical Center and the University of Louisville Hospital.  The pro-rata distribution is based on the off-label utilization at the respective agencies.

AstraZeneca illegally promoted Seroquel’s off-label uses in children and adolescents well before establishing that the drug was not safe or effective for any use by those that age.  AstraZeneca also promoted Seroquel for off-label uses for the elderly, without establishing its safety or effectiveness for elderly individuals. 

As a result of AstraZeneca’s unlawful marketing and promotion of Seroquel, utilization of the drug by Kentucky Medicaid recipients dramatically increased. By August, 2004 more than 25 percent of Seroquel users in Kentucky were under 18 years old and approximately 15 percent were older than 65.  As part of its marketing strategy, AstraZeneca sought to induce psychiatrists to switch from prescribing competing drugs for their patients to prescribing Seroquel.  AstraZeneca withheld or failed to disclose negative information concerning the effectiveness of Seroquel, and withheld or failed to adequately disclose the risks associated with using Seroquel.

Medicaid Fraud Recoveries

Since taking office in January, 2008, General Conway’s Office of Medicaid Fraud and Abuse Control has recovered or been awarded more than $292 million for the state and federal Medicaid programs.  These cases range from lawsuits and settlements against pharmaceutical companies to cases against individual providers.

The Attorney General’s Tip Line for reporting allegations of Medicaid fraud is 1-877-228-7384.